CostofProductionforProcessedOranges
GrowninSouthwestFlorida,2015/16
ArielSingerman,AssistantProfessorandExtensionEconomist
UniversityofFlorida,IFAS,CREC,LakeAlfred,FL
Thisarticlepresentsthecostofproductionperacreforprocessedorangesin
SouthwestFloridaduring2015/16.Thecostestimatesbelowdonotrepresentany
individualoperation.Instead,theirpurposeistoserveasabenchmarkforthe
Floridacitrusindustry.Typicalusersoftheseestimatesincludegrowers,
consultants,propertyappraisersandresearchers.
Atotalofthirteengrowersparticipatedinthedatacollectionprocessby
attendingeitherofthetwomeetingsattheUF/IFASSWRECandArcadiaExtension
OfficeinMayandJune2016,respectively.Growersbroughtacompletedsurvey
formtothemeetingthathadbeendistributedtothembeforehand.The
questionnaireaskedgrowerstoprovideannual,peracrecostsbyprogramfora
“typical”irrigated,maturegrove(10+yearsold),includingresets.Bysurveying
growersregardingthecostsoftheirproductionprogramsthefiguresreportedin
thisarticlecloselyreflectgrowers’cost.
Thedatacollectionprocesswasanonymousandconfidential.Duringthe
meetingeachgroweruseda“clicker”orremotedevicetoenterthecostsforeach
caretakingprogram.Thefiguresbelowwereobtainedbycomputingtheweighted
averageoftheresponsesbytheacreageofeachoftheparticipatinggrowers.The
numberofacresmanagedbytheircombinedoperationsaccountsforapproximately
41,000acres.TheacreagefororangesinSouthwestFloridaduring2015was
estimatedat257,298(USDA-NASS,2015).Thus,thesampleofgrowersrepresented
16%oftheacreagedevotedtoorangesinthatregion.
Table1showsthecostsofproductionbyprogram.Theestimatesinclude
boththecostsofmaterialsandthecostassociatedwiththeirapplication.Thetotal
forweedmanagement–whichincludeschemicalandmechanicalmowingaswellas
herbicides–was$210.09peracre.At$611.62peracre,foliarspraysrepresented
thelargestproductioncost.Groundappliedfertilizerwasthesecondlargest
expenseat$454.18peracre.CitrusHealthManagementAreas(CHMA)sprays
accountedfor$17.96peracre.Theexpenseforpruningwas$49.83peracre,while
thatforirrigationwas$180.88peracre.Addingallthecostslistedabove,the
culturalcostofgrowingorangesforprocessingduring2015/16withouttree
replacementwas$1,524.55peracre.
Growerswerealsoaskedtoprovidedetailsregardingtheirresetpractices,
includingthenumberoftreesreplacedintheirgroves.Onaverage,growers
replaced9treesperacreduring2015/16.Thetotalcostoftreereplacement,
includingtreeremoval,sitepreparation,andcareofyoungtreesforthoseninetrees
wasestimatedat$385.70peracre.Addingsuchfiguretothetotalcostaboveyields
atotalproductioncostwithtreereplacementof$1,910.25peracre.
Figure1depictsadoublepiechart.Thelargerpieshowsthecostofeach
programaswellasthepercentagerelativetotheculturalproductioncostswithtree
replacement.ThesmallerpieinFigure1providesgreaterdetailregardingthe
individualcomponentsincludedinthefoliarsprayscategory.Theexpenseof
$611.62wasdividedasfollows:insecticidestotaled$183.95peracre,(representing
10%oftheculturalcostofproduction);fungicidesaccountedfor$99.73peracre
(5%);foliarnutritionalsfor$165.91peracre(9%);aerialapplicationfor$28.92per
acre(1%);groundapplicationofmaterialsfor$133.11peracre(7%).
Figure2showsacomparisonofthecostofthemainproductionprogramsin
2015/16relativetothepreviousseason.Thegreatestchangewasthereductionin
insecticidespendingby$50peracrecomparedtolastseason.Weedmanagement
andfertilizerwerealsoreducedby$38and$33peracrecomparedto2014/15.
However,thecostoftreereplacementincreasedby$39comparedtolastseason.
Inadditiontoculturalcosts,growerstypicallyhavetoincurinothercosts
whenmanagingtheirgroves;theseothercostsincludemanagement,regulatory,and
opportunitycosts.Table2showsthetotalcostofproductionforprocessedoranges
inSouthwestFloridaduring2015/16was$2,327.98peracre.Basedonthis
estimate,thebreak-evenpricesperboxfordifferentlevelsofyieldarepresentedin
Table3.Break-evenpriceswerecalculatedonanon-treeanddelivered-inbasis.The
latterassumesharvestingcostsperboxwere$3.22,whichisbasedontheresultsof
thesurvey“2015/16Picking,Roadsiding,andHaulingChargesforFloridaCitrus”.
ThecalculationsinTable3alsoincludetheFloridaDepartmentofCitrus(FDOC)
assessmentof$0.23perboxforthe2015/16season.Thus,forexample,theon-tree
anddelivered-inbreak-evenpricesforcoveringthetotalcostsofproductionwith
yieldat250boxesperacrewere$1.59and$2.18perpoundsolids,respectively.
Summary
Thisarticlepresentsasummaryofthe2015/16costsofproductionforProcessed
OrangesinSouthwestFlorida.Themethodologychosentocollectthedataconsisted
ofsurveyinggrowersdirectlytocloselyreflectgrowers’costsintheeraofHLB.The
totalcostofproductionforProcessedOrangesin2015/16was$2,327.98peracre,
down$87.86peracrefromlastseason.
References:
U.S.DepartmentofAgriculture,NationalAgriculturalStatisticsService(USDA-NASS).2015.
CommercialCitrusInventory:PreliminaryReport.FloridaDepartmentofAgriculturalServices.
Maitland,Florida
Table1.CulturalCostsofProductionperAcreforProcessedOrangesinSouthwest
Florida,2015/16
Number
Materials
Application
Costs represent a mature grove
of
Cost
Cost
(10+ years old) including resets
Applications per acre ($)
per acre ($)
Cultural Costs
Weed Management
Mowing (Chemical &
mechanical)
6
1.08
58.41
Herbicides
3
103.09
47.51
Total Weed Management Costs
Foliar Sprays
183.95
Insecticides
99.73
Fungicides
165.91
Nutritionals
Application:
5
133.11
Ground
3
28.92
Aerial
Total Foliar Sprays Costs
CHMAs Sprays
3
17.96
Total CHMAs Sprays Costs
Fertilizer
Ground/Dry Fertilizer
3
326.45
26.84
Fertigation/Liquid Fertilizer
6
73.12
27.76
Total Fertilizer Costs
Pruning
Topping & Hedging
1
29.63
Chop/Mow Brush
1
20.20
Total Pruning Costs
Irrigation
1
Irrigation System
Fuel for pump
Total Irrigation Costs
Total Cultural Production Costs without Tree Replacement
Tree Replacement (9 trees):
Tree Removal (Clip-shear; use front-end loader)
Site Preparation and Plant Tree (includes reset trees)
Supplemental Fertilizer, Sprays, Sprout, etc. (Trees 1-3 years old)
Total Tree Replacement Costs
Total Cultural Costs with Tree Replacement
1
Total Cost
per acre ($)
59.49
150.59
210.09
449.59
133.11
28.92
611.62
17.96
17.96
353.29
100.89
454.18
29.63
20.20
49.83
130.31
50.57
180.88
1524.55
60.66
96.84
228.20
385.70
1910.25
Irrigationsystemincludes:maintenanceandrepairstoemitters,cleanditches,ditchandcanalmaintenance,watercontrol
Table2.TotalCostsofProductionperAcreforProcessedOrangesinSouthwest
Florida,2015/16
Total Cultural Costs
Other Costs
1910.25
Interest on Operating (Cultural) Costs
95.51
Management Cost
131.24
Property Tax/Water Management Assessment
28.73
Interest on Average Capital Investment
162.25
Total Other Costs
417.73
Total Costs
2327.98
Table3.Break-EvenPriceperboxforProcessedOrangesinSouthwestFlorida,
2015/16
Yield(boxesperacre)
175
200
225
250
275
300
325
350
375
dollarsperacre
CostofProductionperacre
2328
2328
2328
2328
2328
2328
2328
2328
2328
PickandHaulperacre
564
644
725
805
886
966
1047
1127
1208
FDOCassessment
40
46
52
58
63
69
75
81
86
TotalDelivered-inCostperacre
2932
3018
3104
3190
3277
3363
3449
3535
3622
Break-evenPrice:
$perbox
On-tree
13.30
11.64
10.35
9.31
8.47
7.76
7.16
6.65
6.21
Delivered-in
16.75
15.09
13.80
12.76
11.92
11.21
10.61
10.10
9.66
1
Break-evenPrice: $perpoundsolids
On-tree
2.27
1.99
1.77
1.59
1.44
1.32
1.22
1.14
1.06
Delivered-in
2.86
2.58
2.35
2.18
2.03
1.91
1.81
1.72
1.65
1Assumes5.86poundssolidsperboxbasedonFloridaDepartmentofCitrus(FDOC)ProcessorStatisticalReportforthe
2015/16season
Figure1.CulturalCostsofProductionforProcessedOrangesGrowninSouthwestFlorida,
2015/16
Figure2.CostofProductionbyProgramforProcessedOrangesGrowninSouthwest
Florida,2014/15vs.2015/16